Assistant Secretary Geoffrey Pyatt’s Remarks to the 30th Annual HACC-NACC Shipping Conference

Moderator: Good afternoon, all. My name is Dan Tadros, and I am the Chief Operating Officer for the American P&I Club. I’m honored to be here today, and I’m especially happy to see so many familiar faces in our audience.

Today I have the privilege, or we will all have the privilege of hearing from the Biden administration’s energy diplomat, a true visionary and leader in the field of energy interdependence, energy transition, and energy security. Our keynote speaker played a pivotal role in building a remarkable foundation over multiple administrations for a strong and important strategic relationship between the United States and Greece. A U.S. Ambassador in Athens, he put a huge priority on our bilateral energy relationship, helping to support Greece’s energy security but also supporting Athens to assume a greater regional leadership role on energy issues.

Assistant Secretary of State for Energy Resources, Geoffrey Pyatt, has spent 31 years telling America’s story abroad as an American diplomat. Having earned a Bachelor’s Degree in Political Studies from the University of California and a Master’s Degree in International Relations from Yale University, Assistant Secretary Pyatt joined the Foreign Office in 1989. His engaging speaking style, and I’ve witnessed him speak, and his ability to connect with audiences with all backgrounds make Assistant Secretary Pyatt an inspiration to many.

Today he will be sharing his insights on the shifting global energy map in the wake of Russia’s war in the Ukraine, the US response to the war, and the US’s actions against Russia through the price cap regulations, as well as the importance of the shipping sector for both our decarbonization goals and our energy security objectives.

Get ready to be inspired, challenged, and empowered to take action.

Please join me in giving a warm HACC NACC welcome to what some Greek officials and certainly the Greek press have dubbed the most active U.S. Ambassador in Greece. Assistant Secretary Georffrey Pyatt.

A/S Pyatt: Great, thank you very much for that introduction, Dan. I’m sorry I can’t be with you in New York today, especially after that introduction, but let me just say what a huge pleasure it is for me to be with you, with the Hellenic American Chamber of Commerce, but also with the Norwegian Chamber.

As you alluded to, I left a little bit of my heart in Athens. I’m enormously honored to have served as US Ambassador during a really critical period. But I also should note, I had a terrific engagement last October where I co-chaired along with Norwegian Energy Minister Aasland our Energy and Climate Dialogue between the US and Norway. So, this is a really good opportunity for me.

I should also note how much I appreciated catching the last bit of the previous panel. And I think the issues that were touched on there around offshore wind, around the modernization of the shipping fleet, and around the Jones Act all illustrate what a complicated set of issues it is that we’re trying to navigate through in the course of this energy transition, and not coincidentally, the absolutely central role that global shipping and our maritime partners around the world are going to play in our success in that effort.

Let me start by framing the importance of these issues, of climate, energy,

energy transition. And of course, even since I left Athens in 2022 we have seen further drastic change in the European energy landscape. The climate crisis, including the terrible rains that everybody’s reading about in my hometown of southern California just yesterday and today is reminding all of us, on both sides of the Atlantic, that we have to engage with even greater urgency on this energy transition. Figuring out how to reduce our dependence on fossil fuels, figuring out how to minimize the climate impact of the fossil fuels that our economies continue to use, innovating in areas like carbon sequestration, better monitoring and capturing the fugitive gases. But this is a real challenge to all of us.

I saw this firsthand during my time in Greece, living through the terrible fires in Mati, of course. And then the example just last year of the fires in Evros and then the terrible, terrible flooding in Lamia, a region of Central Greece that I had gotten to know quite well.

Meanwhile, of course, over the past two years as we now mark the tragic second anniversary of Putin’s brutal invasion of a sovereign neighbor in Ukraine, we have seen the risks that have come from our excessive dependence on Russian origin fossil fuels.

I want to underline in this regard the absolutely critical role that energy producers here in the United States and in Norway have played in helping Europe to overcome its previous vulnerability to Russian energy coercion and to largely diffuse the Russian energy weapon as Europe now sees the tail-end of a third winter of Putin’s energy war.

But that weaponization of Russia’s energy resources has also made clear that Russia categorically is never again going to be viewed as a reliable supplier of energy. And it has highlighted for all of us the risks that come with dependence on a single source of energy and energy resources.

The change in the global energy map that Putin’s invasion has provoked is going to result in real long-term losses for Russia in terms of both its global energy influence and its future role in the international energy economy. According to Russia’s own Finance Ministry, Russia’s annual oil and natural gas revenues fell 24 percent in 2023, and the latest monthly report from the International Energy Agency confirms that Russia’s oil export revenue in December of 2023 fell by $2.6 billion compared to November of 2022 before the coalition import bans and price cap policies were implemented.

All of this has enormous implications for a country that in 2021 relied on oil and natural gas revenue for 45 percent of its federal budget and we in the United States, our partners in the G7 and in the price cap coalition are determined to do everything that we possibly can to continue constraining and reducing the revenues that Russia uses to fund its brutal invasion, the violations of internation law and human rights that we see every day in the news from Ukraine. All the while seeking to limit the impact of Russia’s war against Ukraine on global energy price volatility.

So we are therefore strictly committed to the enforcement of that price cap and I want to spend a minute talking about that, because coalition compliance and enforcement authorities are taking allegations of price cap violations and circumvention very, very, seriously. We’ve designated 13 entities already in price cap enforcement actions, and we will continue to exercise US authorities to take action where appropriate.

We’re also using sanctions to degrade Russia’s future capacity to produce and export energy resources, ensuring that Russia will never again be able to weaponize its energy resources for political gain.

The twin challenges of the climate crisis and energy security present a fundamental threat to our collective prosperity and our future security and Greece and Norway know that very well.

But the incredible and unprecedented disruptions that Putin has caused over the past two years have also sparked a wave of innovation as the transatlantic community works jointly to meet this moment and to accelerate our energy transition.

As we’re tackling the existential threat of climate change and seeking to build up our collective energy security by deploying more clean energy sources, one massive challenge that we’re going to have to work through is decarbonizing hard to abate sectors and shipping is on the top of that list of hard to abate sectors.

I know it’s been mentioned already in this morning’s discussions that global shipping is one of the top ten sources of greenhouse gas emissions if it were a country. It would have a similar carbon footprint to Germany or Japan. Needless to say, progress against this sector is essential to decarbonizing our industrial economy and meeting the target of one keeping 1.5 degrees of climate change within reach.

Now during my time as Ambassador in Athens I engaged heavily on a variety of maritime issues given the leading role that Greek shipping plays in international maritime commerce. I was honored to play a leading role in what has become DFC’s historic investment in the Elefsina Shipyard. I was pleased to see the way in which the Greek Ministry of Shipping, the Greek Ministry of Foreign Affairs, the Greek Ministry of Energy have all worked together to lift up the role of Greek shipping in this energy transition. And now in my position as Assistant Secretary in the Bureau of Energy Resources, the role of the shipping sector and energy transition in the shipping sector links naturally to my portfolio, especially at a moment when the geopolitics around these issues is more complicated than it’s ever been.

The maritime sector and global shipping play a central role, of course, in driving global energy commerce. The United States in the face of Russia’s weaponization of its energy two years ago has now mobilized over 60 percent of our LNG exports to Europe last year alone — helping to fill the gap after Russia unilaterally cut off piped natural gas supplies to many European partners.

Much of that American LNG was carried by Greek-owned tankers. Meanwhile Norway continues to play the dominant role as Europe’s source of non-Russian gas.

But shipping is also going to play a key role in our efforts to accelerate the global energy transition. Shippers are not just buyers of new fuels, they are the purveyors and transporters of those fuels to the rest of the world, and in the future bulk carriers owned by shipping companies like yours are going to be carrying hugely increased volumes of energy minerals — cobalt, lithium, nickel, zinc, copper. All of the critical minerals that we are going to need to drive our energy transition and ensure the reliability of energy supplies that our citizens demand.

There’s also the question of how to accelerate the deployment of new low and near zero emission shipping which comes in the backdrop of the conversation I just heard the end of about the recapitalization of the global shipping fleet.

The adoption of new fuels like clean ammonia and methanol can help to transport goods including energy resources while helping us to decarbonize other hard to abate sectors and providing the support needed to bring technologies like offshore wind energy online.

I’ve greatly appreciated all that I have learned about Norway’s strong focus on this question of energy transition in the shipping sector, but I also want to highlight what I know to be Prime Minister Mitsotakis’ determination to make Greece a hub for best practices in green shipping and to stimulate the generation of new fuel supplies to power that shipping industry that is so central to Greece’s historic identity as a maritime power.

Investment in bringing new fuels to the shipping market of course is going to depend on the business case and we in the State Department want to work with the off-taker community to see how public/private partnerships can best support these new fuel supply chains.

But new technology and innovations in fueling and engines is only part of the equation. We need the support and the collaboration of the entire industrial community including all of the companies, flag registries, and maritime entities represented there in New York Today.

First mover actions are going to be critical in a sector where return on investment is measured in decades, which is why conversations like the one that we’re having today is so important.

But I’m very happy to tell you that I think we’re coming into 2024 on these difficult issues with the wind in our sails. The IMO, of course, recently adopted a revised strategy for the reduction of greenhouse gases from ships which for the first time sets the goal of net zero for the shipping sector by 2050 or as close as possible, including major reductions by 2030 which basically means we have to get to work now.

We’re working on this challenge through a variety of platforms. At COP 27 in Egypt in Sharm El-Sheikh the United States was proud to co-host the Green Shipping Challenge with Norway which focused on concrete actions the maritime sector could take to keep 1.5 degrees alive. We made there over 40 announcements of new actions as a direct result of the Green Shipping Challenge including new green shipping corridors, new zero emission ships, and new policies by the United States, Norway, and Greece, among many others.

We were able to build on that momentum at COP 28, nearly doubling the number of commitments and announcing substantive updates to the results of COP 27.

I really appreciate the leadership of our Norwegian government colleagues in this Green Shipping Challenge, and I want to thank Norway for co-hosting the COP 27 session along with us, joined by France and Denmark.

Working with our international partners, especially in Europe, is how we’re going to build out supply chains of the new fuels and technologies that are going to make the green shipping revolution possible.

We want to work with you in industry to reduce emissions, to facilitate the energy transition across the shipping industry and other hard-to-evade sectors, and to understand the global redrawing of the energy map that the energy transition is going to bring about as the world sees much less crude oil being shipped around the world and a lot more energy minerals.

I’ll stop there and just say how excited I am to be part of this conversation about the future of global shipping. Having lived in Athens for six years, I acquired a great appreciation for the absolutely essential but oftentimes invisible role that global shipping plays in making our globally connected economy work. Now we need to work together in partnership to help build a cleaner shipping industry, recognition that that target is more within reach today than it ever has been before.

I wish you all a very good conference. I very much look forward to discussing many of these issues with my Greek government counterparts including from the Foreign Ministry and from the Ministry of Energy later this week at our US-Greece Strategic Dialogue here in Washington which Secretary of State Blinken will kick off on Friday. And I very, very much look forward to hearing about the outcomes from the Our Oceans Conference in Athens in April, an initiative that I helped to launch along with Prime Minister Mitsotakis and then Foreign Minister Dendias where I know Prime Minister Mitsotakis has placed green shipping at the very top of the agenda.

So, thank you very much, Ευχαριστώ πολύ to my Greek friends, and I look forward to hearing the results of your further discussion.